July 11, 2017

Progress Report Shows Need to Pick Up Pace of Job Licensing ReformLegislature Needs a Framework to Resist Industry Support for Red Tape

OMAHA, NE (July 11, 2017) – In January, Nebraskans in nearly 200 different occupations needed a government license to do their job, with many workers facing greater barriers to entry than in most other states. Following a legislative session where senators from all parties supported occupational licensing reforms, the number of licensed professions has been reduced slightly, and some licensing requirements have been streamlined.

But many of the state’s most burdensome occupational licensing laws still remain stubbornly unchanged or unexamined.

A new report by the Platte Institute provides a review of what happened—and didn’t happen—in the Legislature in 2017 when it comes to reducing licensing red tape that holds Nebraskans back, and what else workers, entrepreneurs, researchers, advocates, and regulators are saying can be done.

A condensed copy of the 2017 Occupational Licensing Review is attached in PDF format and is published in an extended version with a full appendix of resources at PlatteInstitute.org/Jobs.

“Nebraska has started the conversation on occupational licensing, and has already enacted some meaningful reforms, but there is more work to be done,” said Sarah Curry, Policy Director at the Platte Institute and author of the new report.

“We’ve still got too much red tape on the books, and the Legislature won’t be able to make enough of an impact by picking away at licenses one at a time. The only way to make a meaningful difference breaking down that many barriers is by approaching the problem in a more systematic way,” said Curry.

A news conference call on the report will be held TODAY,Tuesday, July 11, 2017 at 10:30 a.m. Central Time. Curry will be joined by Platte Institute Director of Government Relations Nicole Fox and Adam Weinberg, Platte Institute Communications Director.

To call in or participate in the news conference call, dial(605) 475-4000, Access Code: 106202#. The call may be recorded for broadcast and will include Q&A.

Here are highlights from the report:

While some regulation will always be needed, Nebraska’s regulatory policies are unnecessarily limiting entry into occupations or industries in a manner that lessens competition. As a result, fewer new jobs and new businesses are being created in Nebraska than in the states which gain the most population and income from relocating Nebraskans.

A wide variety of researchers, professionals, and advocates agree that the burden of occupational licensing has become counterproductive. Dr. Morris Kleiner, the AFL-CIO Labor Chair at the University of Minnesota writes in one study: “Licenses are required for more and more professions, and that has two major impacts: consumers are overpaying for services, and workers are being pushed out of professions. There are tremendous societal costs with little improvement to service, quality, health, and safety.”

Workers in Nebraska pay millions of dollars in fees each year to state agencies responsible for overseeing licensure. The Department of Health and Human Services, which administers licensure in over 50 of the nearly 200 licensed professions, collected just over $62 million in fees in Fiscal Year 2016, though not all the fees are related to licensing.

The Federal Trade Commission’s Office of Policy Planning, part of the independent federal agency responsible for protecting competition, wrote state senators in March, saying “in effect, excessive licensing acts as a state-created barrier for people seeking work,” and calling for an improved framework for scrutinizing Nebraska’s licensing laws. Here’s a summary and a full copy of their letter.

Key licensing reforms that passed in 2017 include repeal of licensure for motor vehicle salespeople, making licensing for officers at state-chartered banks optional, and ending a requirement that audiologists acquire 2 separate licenses to practice. Other bills streamlining requirements for title examiners and school bus drivers, and exempting equine massage therapists from needing a veterinary license were advanced from committee but not yet scheduled for debate.

Reform bills that faced the most opposition included LB343, which would have aligned Nebraska’s training requirements for many personal care licenses with most other states, and LB299, which would create a regular review process for all occupational licensure. Established industry groups, state licensing boards, and commercial schools and colleges led the charge against the reforms.

Lawmakers will conduct 8 interim studies on occupational licensing reforms prior to the end of this year, including studies on most of the professions included in LB343, as well as body art, and farm labor contractors.

With nearly 200 professions requiring licensure in Nebraska, and constant pressure from incumbent industry groups to increase licensing barriers, the state cannot address this problem in a piecemeal fashion. A comprehensive review of all occupational licenses is needed. Legislative Bill 299, the Occupational Board Reform Act, is an example of a comprehensive evaluation to determine which current and future licenses are truly needed to protect the public, or if less restrictive regulatory alternatives may be appropriate.

To arrange an interview about occupational licensing reform in Nebraska, please contact Adam Weinberg at (402) 452-3737 or at aweinberg@platteinstitute.org.